Letters to the Editor
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Value
I think hitting that $400 price point will spur up more sales for the PS3, but I don't think that alone will bring the PS3 back into the race. As has been said, it all comes down to the games. Unfortunately for Sony, it looks like this isn't going to happen until well into 2008.
Many consumers probably don't look too closely at the tech specs, and Sony probably won't put a big yellow sticker advertising "now with exciting reduced functionality!" on the outside of the box. They'll just see the $400 tag on something that started out at $600 and think they're getting a deal.
On the other hand, at $400, it is now cheaper than several standalone Blu-ray players out there, so it could be an appealing alternative for people wanting HD playback. As long as they don't mind using the game controller instead of a more traditional remote (or if they're willing to buy the PS3 Blu-ray remote separately), it could be a good fit there.